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Our Addiction to Oil is Fueling World Poverty

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Thanks to a renewed push by policymakers and two years of historically high gas prices, renewable energy is an issue that has climbed to the top of our national agenda. But in the United States, the energy debate tends to be fixated on the issue of national security. This is for good reason — 65 percent of our oil is imported; any disruptions in supply or further price fluctuations could have devastating consequences for our foreign policy and economic security. But energy is not just about our national security and it should not only top our national policymaking agenda. Energy should also top our development agenda.

Today, energy is a source of poverty for many nations. The price per barrel of oil has doubled to $60 U.S. dollars in two years and has had a disproportionate impact on the poorest countries, 38 of which are net importers and 25 of which import all of their oil. Countries are forced to spend their resources on oil rather than meeting their population’s needs. In fact, the top recipients of debt relief under the Heavily Indebted Poor Countries Initiative are forced to spend the money saved on oil imports rather than on putting more kids in school, providing access to HIV/AIDS medicine, improving water quality, increasing access to health care, and enhancing their country’s infrastructure.

Energy in the developing world is expensive, inaccessible, and sometimes deadly. The United States uses two-thirds of all oil for transportation, but in the rest of the world oil is also commonly used for space heating and power generation. Approximately two billion people in the world lack reliable energy sources, often going without refrigeration, heat, or even light. For the world’s poor, the only affordable available energy tends to be crop residues, animal wastes, and wood chips. Some lack even these basic resources, but for those that have them, burning this biomass in inefficient stoves or over open flames is the only way to stay warm or cook a meal. These stoves are a health and safety hazard, and as many as two million deaths each year are attributed to the indoor air pollution caused by this process.

To compound the problem, our global dependence on fossil fuels has dramatically increased the threat of global climate change — a threat that is real and carries catastrophic consequences especially for the world’s poor.

People in poor countries face a far greater threat of climate change due to risk factors such as inadequate housing on marginal lands, poor healthcare systems, and heavy economic dependence on natural resources for food, income and medicine. It is therefore not uncommon for single weather events, such as tropical cyclones and floods, to wipe out local economies and kill thousands of people in regions such as South Asia, southern China, and Central America. A recent study by Columbia University and the World Bank assessed the big natural killers between 1980 and 2000; topping the list were droughts causing over 560,000 deaths, storms next at over 250,000, and floods responsible for over 170,000 deaths. Poverty ridden communities in remote areas often do not have immediate access to relief services or adequate resources to recover from disasters — as we saw last month in the Philippines landslides that killed more than a thousand people. The increasing risk of catastrophic storms caused by climate change will only exacerbate the situation.

For the 1.3 billion people around the world who live on less than a dollar a day, energy does not have to be a source of sickness or poverty. Renewable energy can be a source of opportunity. Developing a bio-based economy in conjunction with opening agricultural markets and reforming subsidies can help reduce poverty by creating new job opportunities and providing a major new source of food and revenue for farmers.

We must take action now to chart a sustainable, secure, and affordable energy future — one that can be realized by all of the world’s people. Our first step must be to invest in alternative sources of energy that curb oil consumption and provide energy for the world’s poor. In the near term, an investment in biofuels can provide a practical and potent way to promote sustainable development and a sustainable environment.

Biofuels are fuels derived from plants and agricultural waste. They produce little carbon monoxide, fine particulate or toxic emissions which would reduce air pollution compared to petroleum-based fuels. Developing a biofuel-based economy can also help reduce hunger and poverty by providing a real economic opportunity for farmers — especially for the two-thirds of people in the developing world that work in agriculture. Biofuels can provide a major new source of revenue for farmers — at $40 per dry ton, farmers growing 200 million tons of biomass in 2025 would make a profit of $5.1 billion per year. In fact, many countries are already capitalizing on the biofuels alternative, and Brazil thus far is leading the way.

Over the past three decades Brazil has managed to turn a rich supply of sugarcane into a rich supply of biofuel, specifically ethanol to power its transportation sector. Currently, more than 40 percent of Brazil’s energy comes from green sources in comparison with around seven percent in developed countries. Consumers are saving at the pump since ethanol is cheaper than gasoline, while the government has saved nearly100 billion dollars in debt from anticipated oil import costs. On top of that, the bio-based transportation sector has created nearly one million new jobs for its citizens and demonstrated to the world that the technology available today is sufficient to expand production of biofuels in the very near term.

On a smaller scale, local communities across the developing world are also capitalizing on the biofuels alternative. In Mali, women’s groups are using biodiesel generators to power grinding mills, vegetable and nut presses, and provide electricity. Individual users of the machines have seen their annual income more than double and their work hours decrease, and villages with these generators have increased the number of girls in school and improved literacy rates among women.

Biofuels are part of the solution for reducing dependence on foreign oil, protecting the environment, creating new markers for agricultural products, and helping the world’s poor lift themselves out of poverty. A global investment in biofuels and the technology to support the conversion to a bio-based economy represents an opportunity to bring basic energy services to millions of people in the developing world while supporting sustainable development and a sustainable environment.

Here at home, the U.S. currently produces 3.4 billion gallons of ethanol per year, but if we make the right investments in biofuels now, ethanol — coupled with improvements in efficiency — has the potential to dramatically reduce the United States’ need for oil while curbing the global pollution that threatens the world’s most vulnerable people. It’s an investment in our global future and one we can no longer afford to delay.

For more information on renewable fuels and climate change, check out Fueling the Future, Resources for Global Growth, and Meeting the Climate Change Challenge.

Kathy Roche is the Speechwriter and Teresita Perez is a Research Associate at the Center for American Progress.

To speak with our experts on this topic, please contact:

Print: Katie Peters (economy, education, poverty, Half in Ten Education Fund, women's issues)
202.741.6285 or kpeters@americanprogress.org

Print: Tom Caiazza (foreign policy, health care, LGBT issues, gun-violence prevention, the National Security Agency)
202.481.7141 or tcaiazza@americanprogress.org

Print: Chelsea Kiene (energy and environment, Legal Progress, higher education)
202.478.5328 or ckiene@americanprogress.org

Spanish-language and ethnic media: Tanya Arditi
202.741.6258 or tarditi@americanprogress.org

TV: Rachel Rosen
202.483.2675 or rrosen@americanprogress.org

Radio: Chelsea Kiene
202.478.5328 or ckiene@americanprogress.org